Keoghs Insight


Mark Hall

Mark Hall


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Whiplash Reform - The problems with the definition of “whiplash injury” and compensation tariffs


I have always been intrigued by the law of unintended consequences.

Why is it that purposeful actions so often result in unforeseen outcomes?

So I ask myself:

Is this law playing mischief with the whiplash reforms?

And if so, will unintended consequences provide an unexpected drawback to the desired intention of the reforms or even worse produce the total opposite to what was intended?

The overarching aim of the whiplash reforms is stated to be to reduce fraudulent and exaggerated claims and to control claims costs without compromising access to justice.

Very noble intentions.

But, when I looked at the definition of “whiplash injury” provided by the Civil Liability Act 2018, I could see examples of unforeseen consequences which may interfere with such good intentions.

The problems you see are all in the definition and the application of the compensation tariffs.

The definition

A whiplash injury is defined by the Act as “an injury of soft tissue in the neck, back or shoulder that is….a sprain, strain, tear, rupture or lesser damage of a muscle, tendon or ligament in the neck, back or shoulder, or an injury of soft tissue associated with a muscle, tendon or ligament in the neck, back or shoulder”

You might think this is a very encompassing definition covering all the bases. It includes all possible variations of soft tissue, sprain injuries, shoulders and all of the spine.

We also know that any minor psychological injury,  although not yet defined, so long as it does  not amount to a recognised psychiatric condition will be included in the tariffs that sit next to the definition for an injury  prognosis up to twenty four months.

So far so good.

But then there is the exception part of the definition.

The exception

“An injury of soft tissue which is a part of or connected to another injury and the other injury is not an injury of soft tissue in the neck, back or shoulder”.

Now the claimant has a get out clause to avoid all of the injury being captured by the definition and only a tariff award made.

Our know your opponent analysis of injury types claimed arising from road traffic accidents is already showing that the claimant volume motor market is “gearing up” for the impact of the reforms led by the new definition of whiplash and the resulting tariff compensations.

One way for this is that the exception provides the opportunity to exaggerate injuries received and to add on to the whiplash additional injuries which are not soft tissue in nature.

Insurers are reporting an increased frequency in additional injuries with whiplash, to body areas such as the knees, wrists, thumbs, arms, jaw and injuries to the head including headaches.

And this is just the beginning.

We expect to see an increase in psychological injuries claimed arising from whiplash which amount to more than just travel anxiety and which could be assessed under DSM -5 or ICD-11 as recognised clinical psychiatric injuries.

 So for instance watch out for a diagnosis of acute stress disorder as a sub threshold for post-traumatic stress.  Such a diagnosis from symptoms occurring from day three of the accident and resolving within a month will be very hard to challenge and would fall to be valued under the general psychiatric Injury chapter of the Judicial College Guidelines and not the minor injuries chapter.

And of course expert evidence will be required from a clinical psychologist or psychiatrist to prove any psychiatric injury which will add to cost layering as well as inflating compensation, which is all good for a claimant lawyer acting under a damages based agreement or referral.

Tinnitus claims associated with whiplash would also fall out of the definition and easily push compensation claimed over the proposed new injury small claims track limit of £5,000 even if slight or occasional tinnitus is eventually captured as a minor injury in the next edition of the Judicial College Guidelines.

What about a pre-existing whiplash type injury or the interaction of constitutional factors whether symptomatic or not existing before the accident? The “whiplash injury” definition does not make any such distinction of injury so it may be possible to argue that where there is aggravation or acceleration involvement then this this could fall out of the definition even if the prognosis period is no more than twenty four months.

Surely the reformers did not intend all of this?

Now, so far so bad.

And there is another problem with the application of the whiplash injury definition even if the injury is captured by the wording and a tariff applies.

That problem is “tariff plus”.

Tariff plus

Although the tariffs have yet to be set by the Lord Chancellor, we have the drafts for whiplash injuries up to twenty four months. These post reform compensation amounts are significantly less than current benchmarked average compensation amounts paid out by insurers. So for instance the proposed fixed compensation tariff post reform for an injury duration of six to nine months is £805 against a current average paid amount of £2,700. An average saving of £1,895 per claim is significant particularly when scaled up.

So what is the problem then?

What about those items of injuries suffered alongside the whiplash injury and how do they affect overall compensation?

These injuries will have to be assessed outside of the tariffs under the Judicial College Guidelines with a great deal of them likely to be captured by the minor injuries section.

A minor injury recovering within three months can attract an award of £1,950. Add this to the whiplash tariff of £805 and the total compensation is £2,755 which is £55 more than the current average whiplash paid compensation of £2,700 where the minor injury might overlap or be discounted entirely in a settlement. The amount is even worse for shorter duration tariffs such as three to six months where the “loss” to the insurer is £170. Again this expense amount is significant when scaled up for volume motor injury claims.

The effect of tariff plus should not therefore be underestimated in controlling compensation and overall claims spend. Instead of reducing compensation, injury awards involving whiplash associated with a “connected” injury item may actually increase.

Was this the intention of the reformers?

Back to unintended consequences

So this brings us back full circle to our law of unintended consequences.

History tells us to look to the past to see the future.

It is clear that the claimant volume motor injury market has thrived since LASPO. Frequency went up significantly post LASPO and although it has reduced since then, we are still not below the levels experienced when the reforms were initially envisaged. Fraudulent claims have not significantly decreased. Regulation of claims management companies has proved toothless and Injury claims have become a commodity to be traded leading to the wholesale industrialisation of the claimant motor injury market.

So will the intentions of the reforms really be realised this time?

Or will these unintended consequences negate either wholly or partially such good intentions?

Without a crystal ball only time will tell.